WORLD TRADE  
ORGANIZATION  TN/RL/W/237 
12 May 2009 
 (09-2327) 
Negotiating Group on Rules Original:   English 
  
 
THE WTO FISHERY SUBSIDIES NEGOTIATIONS:  UPDATE AND  
INTRODUCTORY BRIEFING FOR NEW DELEGATES 
 
 
I. INTRODUCTION 
1. This briefing and discussion, hosted by  UNEP and WWF, was held at the World Trade 
Organization in Geneva on 1 Apri l 2009.  The dialogue was convene d in response to multiple requests 
from WTO delegations for a briefing to help th e large number of new WTO delegates come up to 
speed on the fisheries subsidies negotiations w ithin the WTO Negotiating Group on Rules.  The 
briefing was the latest in a series of conferences,  workshops, and briefings organized by the sponsors 
jointly and separately.  It took place during a break in a three-day informal meeting of the Rules 
Group.    2. Participants included arou nd 70 Geneva-based and capital-based officials from 32 national 
governments and several regional intergovernmental organizations.  The workshop was presided by 
Ms. Anja von Moltke of UNEP.  She explained that although the meeting was held for convenience in 
the WTO building, it aimed to offer an informal forum for dialogue outside of the official WTO 
negotiating context.  Participants were all i nvited to speak in their personal capacities.   
 3. This summary report has been prepared unde r the responsibility of the organizers.  It 
synthesizes the main issues raised and discussed by participants.  Although it is not intended as a 
consensus document, it has been sent to all particip ants for their review before finalization.  The 
meeting agenda and materials prepared by the presenters are available online at:  http://www.unep.ch/etb/events/2009% 20FishSubWorkshopWTO1Apr.php
 
 
II. BACKGROUND PRESENTATIONS  
A. INTRODUCTIONS TO UNEP  AND WWF 
4. For the benefit of new delegates, Ms. Anja von  Moltke briefly introduced the work of UNEP's 
Environment and Trade Branch, based in Geneva.  Ms. von Moltke noted the long involvement of 
UNEP, often working in partnership with others, on the fisheries subsidies issue—dating back to the 
first international conference dedicated to the i ssue, co-hosted by UNEP and WWF in 1997.  Since 
then, UNEP has brought forward multiple analyses, country project assessments, consultations and 
workshops.  Reports can be found on UNEP's website at 
http://www.unep.ch/etb/areas/fisherySub.php .   
 5. Ms. Aimee Gonzales of WWF briefly described WWF's global presence, with more than 
eighty offices in countries around the world.  WWF br ings forward scientific analysis and solutions-
oriented policy advice.  WWF's work on fisheries subsid ies is just one part of a broad effort to halt the 
degradation of our oceans and to ensure the ecological  integrity and sustainable use of fish and other 
marine resources.  WWF was the first voice in ci vil society to call for WTO action to eliminate 
harmful fisheries subsidies, and has had a deep technical and political engagement on the issue from 
the outset.   TN/RL/W/237 
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  B. O
VERVIEW OF THE FISHERIES SUBSIDIES ISSUE AND THE WTO  NEGOTIATIONS  
6. Ms. von Moltke gave a short presentation outlining the history of the fisheries subsidies issue 
and of the WTO fisheries subsidies negotiations, as follows:    7. The severity of the current global fisheries cr ises is increasingly evident.  FAO data, reported 
in the 2008 State of World Fisheries and Aquaculture , show that 80 per cent  of the world's fish stocks 
are now fished up to or beyond their biological limits.  A joint study just completed by the World Bank and the FAO titled The Sunken Billions  reveals that inadequate fisheries management costs USD 
$50 billion per year in lost opportunity and value.  And other scientific reports suggest that the trends 
are severely negative, with one study suggesting that commercial fisheries worldwide could be 
completely exhausted by the middle of this century if no further measures are taken.   
 8. Since the 1990s, inappropriate subsidies have been recognized as a significant factor 
contributing to overfishing and to the over-capitaliza tion of fishing fleets.  As IGOs and NGOs such 
as UNEP and WWF brought increased attention to th e issue, several developed and developing 
countries came together in a new coalition known as th e "Friends of Fish" to spearhead efforts to put 
fishery subsidies on the WTO negotiating agenda.  In 2001, these efforts paid off when WTO 
ministers gathered in Doha, Qatar, called on member  states to "clarify and improve" WTO rules on 
fishery subsidies.  The fisheries subsidies negotia tions were thus launched,  and became one of the 
core agenda items for the WTO Negotiating Group on Rules within their Doha Round.    
9. International diplomatic pressure for a str ong outcome to the fishery subsidies negotiations 
grew steadily in the first years of the talks.  In  2002, heads of state gathered at the World Summit for 
Sustainable Development in Johannesburg, South Af rica, called on governments to eliminate harmful 
fisheries subsidies through effective new WTO ru les.  In 2004, a major UNEP workshop held in 
Geneva provided a turning point - moving the nego tiations from the question of "whether" to the 
question of "how" fishery subsidies could be re formed through WTO rules.  And in 2005, WTO 
ministers in Hong Kong issued a significantly streng thened negotiating mandate that expressly called 
for a prohibition on subsidies that contribute to overcapacity and overfishing, with special and differential treatment (S&DT) for developing countries.    10. In November 2007, the chairman of the Negotiating Group on Rules issued the first draft text 
for new WTO fishery subsidies disciplines.  Alt hough the document received significant support as a 
basis for negotiations, it was clear that many el ements raised controversy and uncertainty.  In 
December 2008, the Chair recognized the need for c ontinuing discussion of the issues raised by his 
draft text, and accordingly issued a new document cont aining a "roadmap" to guide further talks.  The 
Chair's text and questions outlined in the roadma p provided the basis for the discussions of this 
informal workshop.   
 C. P
RESENTATION OF UNEP-WWF  DOCUMENT COLLECTION CD 
11. Ms. Gonzales noted the availability of a new collection of UNEP and WWF documents, on 
CD in electronic format.  The CD, which has been distributed to all WTO delegations and was also 
made available at this briefing, contains many of  the leading papers and reports brought forward by 
UNEP and/or WWF since the fisheries subsidies negotiations began.  The collection provides a single 
convenient resource, indexed by topic, for delegates wishing to come up to speed on specific issues.  Additional copies of the CD are available from the organizers.     TN/RL/W/237 
 Page 3 
 
 
  III. DISCUSSION OF KEY ISSUES  
12. Mr. David Schorr summarized several of th e key issues in the ongoing fisheries subsidies 
talks.  Mr. Schorr's presentation was divided by t opic, with time taken for open discussion after each 
topic was introduced.    
A. S
COPE OF THE PROHIBITION  
13. The fisheries subsidies language in the decl aration issued in 2005 by ministers in Hong Kong 
was a political landmark for the WTO talks.  The explicit agreement by ministers that WTO rules 
should include a prohibition on fisheries subsidies contributing to overcapacity and overfishing made 
headlines around the world, including as the lead story on the front page of the International Herald 
Tribune .  The presence of more than half a dozen mi nisters at a high-level press conference endorsing 
a strong outcome on fisheries subsidies gave the i ssue further public visibility.  The Hong Kong 
declaration set a high ambition goal on fisheries s ubsidies, both in terms of the environmental 
outcome and the need for effective S&DT for developing countries.   
 
14. The Chair's text of November 2007, whic h was warmly welcomed by NGOs such as WWF 
and others, proposes a "bottom-up" but broad list of subsidies to be prohibited.  This list can be 
analyzed in three categories:     (i) "The Basics" - i.e., direct basics: subsidies to fi shing capital (physical capacity) and 
operating costs; 
 (ii) "Other Core Subsidies" - i.e., other subsidies with direct commercial relevance to 
fishing and to fish products, such as pr ocessing, marketing, & price supports;  and 
 (iii) "Indirect Subsidies" - i.e., subsidies that may affect the economics of fishing and 
trade in fish products, but less directly, such as subsidies to infrastructure or for social 
safety nets.   
 
15. Subsidies in the first category are at the heart of the ambitions set out in the Hong Kong 
mandate.  Nevertheless, some elements have been controversial.  Several participants noted in 
particular the problem of fuel subsidies, wh ich are widely employed (accounting for a large 
percentage of fisheries subsidies) and which are of ten considered politically sensitive.  It was noted 
that fuel subsidies are difficult precisely because of their combination of very high environmental 
relevance and their direct impacts on livelihoods a nd competitiveness.  One participant suggested that 
the environmental and social consequences of fuel s ubsidies may be complex, such as when they help 
sustain activities that may be environmentally pr eferable (such as fishing on healthier off shore 
stocks) or socially beneficial (such as maintaining the competitiveness of a fleet subject to "return to 
port" rules for the protection of fish workers).  So cial, environmental, and commercial realities cannot 
be overlooked as governments consider rules to limit fuel  subsidies.  Others noted that fuel subsidies 
can directly increase fishing pressure in almost all cases, and one delegate raised the question whether 
fuel subsidies should be considered legitimate, even if they are widely  used.  A number of participants 
considered that fuel subsidies must be subject to WTO discipline, but raised uncertainty over how this 
can best be accomplished.  Possible solutions includ ed the use of transition periods, subsidy ceilings, 
stand-still agreements and roll-backs, or other limitati ons on time and relative level of subsidization.  
It was also suggested that the high environmental im pacts of fuel subsidies in some situations should 
be reflected in eventual WTO rules.    16. In light of the Hong Kong Declaration's emph asis on prohibiting subsidies that contribute to 
overfishing, the question was raised how under WTO rules it would be possible to know when 
overfishing or fleet overcapacity exists in a given case, or whether subsidies had caused such a 
condition.  Responding to this question, the results  of studies by different organizations, including 
UNEP and the OECD pointed to the harmful effect of most types of subsidies that are granted to TN/RL/W/237 
Page 4  
 
  fisheries not governed by effective management syst ems.  The point was made that according to these 
analysis, hardly any of the existing management syst ems are effective enough to avoid overfishing.  It 
was noted, however, that the technical difficulties of  this question could or should be avoided under 
rules such as those proposed by the Chair.  In the case of prohibited subsidies—as with the existing 
prohibitions on export subsidies under ASCM Art. 3—th e effect or impact of the subsidy, or the 
existence of the harmful condition that the prohibiti on is intended to avoid, is not a relevant legal 
consideration.  Rather, the essence of a prohibition under the ASCM is an ex ante  ban on subsidies of 
certain kinds, without regard to their actual eff ects.  Once negotiators determine which classes of 
subsidies should be subject to prohibition, whether overfishing or overcapacity exists in specific cases 
associated with those subsidies is no longer an issue.   
 
17. Similarly, Art. I.2 of the Chair's Text calls only for a finding that an "unequivocally overfished" condition exists.  Although the current draft does not offer guidance on how such a condition could be recognized, it was suggested that this  test might be similar to a "reverse scientific 
basis" test—so that "unequivocally overfished" c ould be taken to mean that the overfished condition 
is clear beyond legitimate scientific debate.  It was noted in this regard that governments would 
remain free, within the bounds of legitimate science , to make their own de terminations regarding 
when an overfished or over capacity condition exists.   
 18. With regard to indirect subsidies such as in frastructure, several participants noted concern 
with the scope and potential effects of including such  subsidies within an eventual ban.  How, for 
example, could one apply the rule proposed by th e Chair's Text, which would prohibit subsidies to 
infrastructure used "exclusively or predominantly  for activities related to marine wild capture 
fishing"?  Moreover, port infrastructure may ha ve multiple purposes—such as increasing marine 
safety in case of storms—even if made predominantly  available to fishermen.  On the other hand, 
some participants were of the view that the Chair' s Text correctly identifies the problem of the "inter-
changeability" of subsidies, which can in effect  allow governments to replace prohibited subsidies 
with permitted subsidies that achieve similar commerc ial effects.  While some participants mentioned 
the concept of "decoupling" indirect subsidies from their potentially harmful effects, others held the 
view that experience with "decoupling" in the c ontext of the Agreement on Agriculture had been 
dissatisfactory.  The question of indirect subsidi es raises issues of circumvention that governments 
will need to address.   
 
19. These concerns raised the further question whethe r the approach adopted in the Chair's Text is 
the most appropriate basis for defining some elements of the prohibition.  With regard to infrastructure subsidies, for example, the Chair' s text adopts what might be called a "use-based" 
approach.  This can also be compar ed to the "physical location" appro ach used by the Chair's Text for 
defining prohibited subsidies to "n ear-port processing activities" (Art. I.1(c)).  Participants discussed 
whether an alternative to such approaches would be to look more directly at the commercial 
consequences of indirect subsidies—that is, thei r impact on the costs or revenues experienced by 
fishers, or their impacts on production or sale of  fish products.  It was noted that current ASCM 
jurisprudence includes some attenti on to the notion of a "pass-through" subsidy, where the relevant 
question is the effective economic benefit enjoyed by the ultimate beneficiary (in this case, fishing 
enterprises).   
 20. Participants also raised qu estions regarding the relationship between new fisheries subsidies 
rules and the existing WTO subsidies code (ASCM).  It was noted that in the early phases of the 
negotiations there had been some discussion of diffe rent formal options for the new rules, ranging 
from the creation of a stand-alone sectoral agreement to direct amendments to the language of existing 
ASCM articles.  The intermediate concept of an  annex to the ASCM has emerged through various 
proposals by delegations, as well as in the Chair's Text.  Many delegations appear to accept this as a good solution, but the question remains open for discussion.    TN/RL/W/237 
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  21. One participant asked specifically whet her the negotiations had touched on possible 
"unilateral" approaches to enforcing new fisheries subsidies rules, to mirror the countervailing duty 
mechanisms of Part V of the ASCM.  It was noted that the Chair's Text does contemplate the use of 
CVDs stemming from new fisheries subsidies rules, and goes so far as to propose that CVD remedies 
be supplemented by the right to deny access to port facilities for fishing or fishing service vessels 
from countries maintaining countervailable subsidies ( see fn. 11 to the Chair's proposed revisions to 
ASCM Art. 4.11).    22. Participants also briefly discussed some of the exceptions to the prohi bition suggested by the 
Chair's Text.  Some participants remarked that the exceptions seemed in general to reflect acceptable 
categories, but that care would be needed to ensure  that exceptions were crafted narrowly.  It was 
noted, for example, that even environmental groups such as WWF have warned  against abuses of the 
proposed exception for subsidies to environmentally friendly fishing techniques (Art. II(b)(2)).  For 
example, it would not be consistent with the Hong Kong mandate to governments to subsidize 
upgraded engines for fishing vessels on the grounds of  fuel efficiency, given the direct and perhaps 
dramatic increase in fleet capacity that would result.   
 
B. S
PECIAL AND DIFFERENTIAL TREATMENT  
23. The Hong Kong declaration set a high bar on fish eries subsidies not only with regard to the 
prohibition of subsidies that contribute to overcapac ity and overfishing, but also with regard to 
S&DT.  The language of the declaration mentions in particular the need for effective  S&DT as an 
integral part  of new rules.   
 24. Both formal and informal discussions of the Ch air's Text to date reveal two sets of issues 
surrounding S&DT:  the scope of subsidies to be c overed by S&DT, and the conditions to be imposed 
on the right to enjoy S&DT.   
 
25. With regard to the scope of S&DT, it was noted that the Chair's text places limits on 
eligibility for S&DT that can be an alyzed in three categories:   
  (i) "Purpose-based" limits, which determin e eligibility for S&DT according to the 
purpose or use of the subsidy;   
 (ii) "Recipient-based" limits, which dete rmine eligibility for S&DT according to 
characteristics of the recipients ( e.g., vessel size or type, artisanal nature of the 
fishing);  and 
 (iii) "Location-based" limits, which dete rmine eligibility for S&DT according to the 
location of the activities be subsidized ( e.g., whether inside or outside of a vessel's 
national EEZ).   
 26. The issue of fuel subsidies was raised once again during the S&DT discussion, and it was 
noted that the Chair's text sharply limits subsidies to operating costs outside of the subsidizer's EEZ.  
The question was raised whether this limit made  sense in terms of either environmental or 
developmental goals.  It was noted, for example,  that WWF had never opposed on environmental 
grounds the application of S&DT to operating co sts, nor had ever sought geographic limits on the 
scope of S&DT.  However, the availability of S& DT beyond EEZ limits could not be separated from 
the question of how sustainability criteria ( e.g., such as conditions related to fisheries management) 
could be effectively applied to international fisher ies (which include all high seas fisheries as well as 
fisheries targeting migratory or straddling stocks within EEZs).   
 
27. With regard to recipient-based limits, severa l participants expressed concern with the use of 
vessel size as a criterion for S&DT eligibility.  One participant noted that the problem to be addressed 
by the Hong Kong mandate is not a "boat problem" but  rather a "fishing problem".  It was further TN/RL/W/237 
Page 6  
 
  noted that even small vessels can be associated with industrial scale fishing as a result of modern 
technologies and/or the practice of using large numbers of small vessels in combination with at-sea transfers to refrigerator ships or processing vessels.    28. It was noted that in the course of the nego tiations the "small boat" question has often been 
linked to the issue of "artisanal" fisheries.  Even as early as the first public statements by the "Friends 
of Fish" delegations, it has been clear that some  kind of special treatment for traditional, near-
subsistence fishing communities is both desirabl e and necessary.  However, two difficulties have 
emerged.  First, it has proved very difficult to find a good and universal definition of "artisanal" 
fishing.  Both in fisheries management literature a nd in the national legislation of many countries, the 
term is often used to include fisheries with si gnificant industrial and commercial characteristics.  
Second, even small-scale, traditional "artisanal" fi shing has in several cases proved capable of causing 
overfishing, while practices such as artisanal dynamite fishing are highly destructive to ecosystems.  Similarly, "artisanal" fishing can be highly competiti ve in both local and international markets (here, 
the UNEP case study on Senegal was mentioned).   
 
29. In addition to discussing issues related to  the scope of S&DT, participants had some 
opportunity to discuss the conditions to be associated with S&DT.  It was noted that from the outset many developing country de legations have indicated that while they are seeking effective S&DT, they 
are not seeking a "blank cheque".  One participant em phasized that in that participant's view there was 
no truth to recent press reports that three larger developing countries are now  seeking a blank cheque 
for S&DT without meaningful sustainability conditiona lity.  The discussion thus continues to focus on 
how—not whether—sustainability criteria should be incl uded in new WTO fisheries subsidies rules.   
 30. The organizers briefly reviewed key elements  of the recommendations presented in the 2007 
UNEP-WWF publication, Sustainability Criteria for Fisheries Subsidies:  Options for the WTO and 
Beyond .  Particular attention was given to the dis tinction between the minimum criteria recommended 
for adoption by the WTO and the more stringe nt criteria UNEP and WWF have proposed for 
unilateral use in national policies.    31. Participants then briefly examined the langua ge of Art. V ("Fisheries Management") of the 
Chair's Text.  Some participants found that the complexity of the text has made it difficult to know 
which of its elements are meant to be mandatory, a nd which only illustrative.  One participant was of 
the view that the current language would require de legations to assume all elements of the proposed 
article are intended to be mandatory.    32. A comparison was made of the UNEP-WWF sust ainability criteria with the elements of a 
management system included in the proposed Art. V.   Participants were encouraged to begin the 
process of more clearly articulating which elements were necessary for minimum adequate management and which could be mo re properly considered illustrations of "best practices".  It was 
suggested that the ambiguity of Art. V could be re duced without reducing its ambition.  A number of 
participants agreed that this would be a productive direction for further negotiations.   
 
33. Some participants continued to voice concer n with the demands to be placed on developing 
countries under sustainability criteria such as those in the Chair's Text.  It is important not to tie the 
hands of governments in making appropriate policy j udgments.  In the view of these participants, the 
high costs of management could pose significant obs tacles, for example where technologies such as 
satellite vessel monitoring systems (VMS) cost more than a poor fishermen may earn in a year.  Other 
participants felt that the existence of difficulties can not be an excuse to avoid the need and obligation 
to pursue good fisheries management.  Many of the fundamental obligations of fisheries management are now reflected in international law, and many developing countries have taken significant strides 
towards improving their fisheries management.  It w as noted that the use of satellite VMS is precisely 
the kind of measure mentioned in the Chair's Art. V that should be clearly identified as illustrative of  TN/RL/W/237 
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  best practices rather than as a mandatory prer equisite of S&DT, as compared, for example to 
conducting science-based stock assessments.    34. Understanding that sustainability criteria may be applicable beyond S&DT (for example, as 
prerequisites to the use of the general exceptions in Art. 2 of the Chair's text), one delegation 
suggested that the criteria applicable to developi ng countries should be differe nt, and more relaxed, 
from those applicable to developed countries.  Othe r participants felt there was no basis for such a 
distinction, particularly in light of the economic power and extensive fishing activities of some larger 
developing countries.  It was also pointed out that the main distinction between developed and 
developing countries contemplated by the Chair's text  is that developed countries would be prohibited 
altogether from employing many classes of subs idies that would be conditionally permitted under 
S&DT.    
IV. CONCLUSIONS AND WAYS FORWARD 
35. The short time allocated to the workshop unfortunately did not allow discussion of two 
remaining items on the agenda:  "institutional mechanisms" and "notification, review, and 
enforcement".  Some remarks on these topics are incl uded in the Powerpoint slides of David Schorr, 
available on the website indicated above.    36. Concluding the meeting, the chair thanked participants for a frank discussion which illustrated 
the need for further dialogue on numerous technical  details put forward in the Chair's text and his 
"roadmap".  She encouraged participants to c ontinue deliberations on the basis of many of the 
elements proposed by the Chair's text, with a view to reducing its complexity but not its ambition.  If 
properly designed, new rules on fisheries subsidi es can be exemplary for trade rules concretely 
promoting sustainable development and environmen tal protection, both fundamental principles 
anchored in the WTO preamble.   
 
  
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